CDBaby, DashGo, AdRev Execs On How Digital Music Revenues, Monetization Innovation Are Growing During COVID Crisis [Midem Digital Edition Spotlight Series]

Artist services companies like CD Baby and label service providers like DashGo had no clue what would happen when the lockdowns started. “We weren’t sure how the artist community would react,” says CD Baby’s SVP of Marketing, Artist Brands Kevin Breuner. “there was a little bit of panic mode,” agrees Ben Patterson, CEO of DashGo. “Everything is shutting down and our industry must be shutting down, so let’s recalculate everything.”

What happened instead was artists began to release everything they could, and labels committed themselves to getting their digital revenue house in order, especially on key platforms like YouTube. What these rapid changes promise for the months and years ahead is explored in the Midem Digital Edition panel, Monetization and Revenue Trends During and After Covid.

Moderator – Ethan Millman, music business reporter, Rolling Stone

Speakers:

• Ben Patterson  – CEO, DashGo
• Kevin Breuner-  SVP of Marketing, Artist Brands, CD Baby
• Jesse Worstell – VP Rights Management, AdRev

Artists “have gone into hyper release and distribution mode,” CD Baby’s Breuner notes. “At the beginning, we were distributing almost double. That was very unexpected. …it’s clear that people decided, ‘We’re going to get new music out.’ That’s one of the big trends; we’re really under a high volume situation now.”

Worstell relays that AdRev, which specializes in monetization on platforms like YouTube, has been inundated with requests from artists and labels. “You can’t play shows, so you concentrate on the things that help bring in revenue. We’ve seen a lot more people submitting music to get ingested into YouTube Content ID.  A lot of our clients have already relied on YouTube revenue, but now we’re seeing a lot of independent acts and publishers really focusing their efforts on YouTube.”

“We may see a trickle-down effect later in the year.”

This push to maximize digital revenue is paying off for artists, though it’s unclear how long the boom will last. “It took a few weeks for people to see that the revenue trends for digital music were, at worst, on pace with where they were prior ot COVID and at best a little bit ahead,” reports Patterson. That said, “We can’t minimize the long-term impact this has had on other parts of the economy… We may see a trickle-down effect later in the year.”

For the time being, however, platforms like YouTube are going strong for music rights holders. “We’re lucky that views are up,” Worstell says. “Ad rev is less but it’s still climbing. With everyone home and not having much to do, we were wondering how this would look, but it’s stayed pretty steady. Getting more content to monetize helps fuel that need.” 

Along with increasing digital revenues, all three companies pointed to outside DSP partners moving faster to get new products and features out to musicians, and to their own internal efforts to speed up technological growth and business model shifts that reflected their future. “We’re really thinking outside the box, building more software-as-a-service tools to enhance what our artists need. Who knows if the CPM rates will decline? How creative people are getting with new ways to share their music. Making sure we have all bases covered and trying to cater to what our artists needs are instead of just monetizing on one platform.”

CD Baby had made a pivotal decision to close its retail store online, the site the entire service was built on. “We’re still doing physical distribution,” Breuner explains, just doing it differently. “We were looking at what our core business is. It’s helping artists to monetize their assets everywhere. New ways music is getting used on these services are popping up every month. Our retail store wasn’t that great an experience, our artists weren’t using it, but in general we needed to leave it behind. It didn’t make sense to keep maintaining things that weren’t our future.”

“There aren’t going to be a bunch of virtual concerts that will replace Coachella or a tour for an artist.” 

For the first crazy weeks after lockdowns began in key markets, livestreaming felt like the future, as artists explored its potential and fans logged onto livestreams, some for the very first time ever. “Between March 15th and April 1st, there were a lot of email conversations and video calls about virtual concerts. There was a lot of initial excitement that this would fill a gap in the live entertainment angle,” Patterson recalls. The reality is more measured:  “There aren’t going to be a bunch of virtual concerts that will replace Coachella or a tour for an artist.” 

Flooding fans with livestreaming dates is not always a good strategy, Breuner argues. “You don’t need to go live every day of the week because there’s a global pandemic. Let’s make it stand out and be more special. Take the time to use these tools better. Have one event you put some effort into every couple weeks. I saw a lot of major label artists going live every night. No one said you have to do this every night. Make it more of a special event for you and your fans.” 

The expansion of digital revenue in size and importance is a worldwide phenomenon, and the COVID crisis has added significance to the panelists’ efforts to build a global team that can serve artists and rights holders in a wide range of markets. “We are really putting a lot of effort into territories outside North America,” says Worstell. “The Latin American scene has blown up. We’ve hired a team to help with efforts there and in Asian countries and African territories that are often overlooked. They shouldn’t be, because the music’s great and is consumed in massive amounts. We try to streamline how rights are managed [in these markets]  and make sure people aren’t infringing on that content.”

Along with getting people on the ground with local knowledge, companies are working on the global aspects of their tech and web presence. “We’ve gone a long way to localize our platform,” notes Patterson. “It’s available in everything from Spanish to Korean. We’ve long seen global growth for the business. CD Baby has the same perspective and a lot of the initial wins we had were from the strong start they had in Brazil and Argentina.”

“so much is changing”

So much is changing, perhaps for good: the way and cadence in which artists release music, the balance of revenues artists see, the emphasis on digital platforms and experiences in growing their audiences and business. “It’s going to be a while before it can be business as usual. I don’t know if we’ll ever go back. People are taking a closer look at their digital business,” Breuner states. “There’s so much opportunity in the digital world you can take advantage of. It’s a good time to finetune that digital engine.”

For more than 50 years, Midem has brought the global music community together in Cannes. This year, Midem Digital Edition (June 2-5) will feature 264 speakers from 48 countries, 64 sessions, and 23 livestreamed keynote sessions, talks, and presentations.

Register for all of the full sessions here: https://www.midem.com/en-gb/midem-digital-edition.html